Key Takeaways
- • Yoco secured a $100 million (approximately R1.6 billion) credit facility from Chicago-based Victory Park Capital to finance its merchant cash advance product, Yoco Capital.
- • The facility is debt financing, not an equity investment; the agreement does not establish a new valuation for Yoco.
- • Yoco has channelled more than R6.5 billion (about $397 million) to over 40,000 businesses since 2018, and serves approximately 200,000 merchants.
- • The deal lets Yoco move lending in-house after previously relying on specialist lending partners, marking its first direct entry into private debt, per Bloomberg.
- • Victory Park Capital manages approximately $3.6 billion and has deployed more than $12 billion across 260 investments since 2007.
Summary
TPG-backed South African payments company Yoco has secured a $100 million credit facility from Victory Park Capital, a Chicago-based private credit firm, to fund its merchant financing business. The facility is worth approximately R1.6 billion and will finance Yoco Capital, the company's automated working-capital product. According to Bloomberg, the transaction marks Yoco's first direct entry into the private-debt market.
Yoco began offering working capital to merchants in 2018 through partnerships with dedicated credit providers. The company says it has since channelled more than R6.5 billion, approximately $397 million, to over 40,000 businesses. Advances range from R2,000 (about $122) to R1.5 million (about $91,700). Yoco uses payment histories generated on its platform to determine eligibility and advance size, and repayments are generally tied to daily sales rather than fixed monthly instalments. The company has not said that all of its roughly 200,000 merchants will qualify, and the $100 million is the total facility size rather than capital already drawn or distributed.
The structure gives Yoco greater control over how credit is offered at scale. Victory Park Capital, which specialises in private credit and asset-backed financing, provides debt rather than purchasing shares, so the transaction does not represent a new equity round or ownership stake. Victory Park said the arrangement is one of Africa's largest dedicated merchant-cash-advance financing deals. Yoco co-founder Katlego Maphai said the facility would allow the company to scale its working-capital offering. Yoco was established in 2015 by Maphai, Carl Wazen, Bradley Wattrus and Lungisa Matshoba.
For Victory Park, the facility provides exposure to repayments across thousands of small-business advances. For Yoco, it offers a revenue opportunity beyond payment processing. The key test will be whether Yoco can expand credit without default rates rising as the lending book grows.
Yoco began offering working capital to merchants in 2018 through partnerships with dedicated credit providers. The company says it has since channelled more than R6.5 billion, approximately $397 million, to over 40,000 businesses. Advances range from R2,000 (about $122) to R1.5 million (about $91,700). Yoco uses payment histories generated on its platform to determine eligibility and advance size, and repayments are generally tied to daily sales rather than fixed monthly instalments. The company has not said that all of its roughly 200,000 merchants will qualify, and the $100 million is the total facility size rather than capital already drawn or distributed.
The structure gives Yoco greater control over how credit is offered at scale. Victory Park Capital, which specialises in private credit and asset-backed financing, provides debt rather than purchasing shares, so the transaction does not represent a new equity round or ownership stake. Victory Park said the arrangement is one of Africa's largest dedicated merchant-cash-advance financing deals. Yoco co-founder Katlego Maphai said the facility would allow the company to scale its working-capital offering. Yoco was established in 2015 by Maphai, Carl Wazen, Bradley Wattrus and Lungisa Matshoba.
For Victory Park, the facility provides exposure to repayments across thousands of small-business advances. For Yoco, it offers a revenue opportunity beyond payment processing. The key test will be whether Yoco can expand credit without default rates rising as the lending book grows.
Go deeper than the headline
Research every firm in this story, track the ones that matter and get the daily briefing — free for 7 days.